LUNA and TerraUSD UST Crash – Why It Crashed and Should You Stay Away?

The cryptocurrency LUNA, has fell dramatically the past couple of days from 80$, to way below 1, $0.00005161 is the price at the current writing.

Why LUNA and TerraUSD UST crashed?

Their sister cryptocurrency TerraUSD UST, which was pegged with the US Dollar at 1:1 lost its peg on 9th may, and right now is priced at $0.1728. Losing the peg meant a loss in credibility and a loss in investors’ wealth and savings accounts that supposedly would have been safe. This followed up with lots of investors panicking and selling their associated LUNA holdings to save whatever balance they can. This transformed and tumbled into panic selling and pushing the LUNA token to worth almost nothing.

Some speculate that behind losing the peg, are investment firms BlackRock and Citadel that orchestrated an attack on UST, and managed to foul the owner Do Kwon into believing they wanted to make real investments, but instead, they dumped lots of BTC & UST, thus making the UST cryptocurrency to lose its peg of 1:1 and dragging attention from other investors. Initially, UST managed to come back from 0.7 to 0.93, but probably when more and more investors noticed that UST can lose the peg in such situations started selling and pushing the price even lower.

Here is a more detailed explanation of what happened

What does peg mean in cryptocurrency?

a cryptocurrency that is pegged means that it should always stay at that price. So a 1:1 peg with the US Dollar means that the cryptocurrency should always be valued at 1$. This term is also used in real-world country currencies and means that a currency is tied to another at a specific price level. For example, Bulgarian LEV is pegged with the EURO at 1.95583.

Did you know that the pound sterling GBP was pegged to the Deutsche Mark D-Mark until 1992?

and the one to make it lose the peg was George Soros. That’s why is he also known as “The Man Who Broke the Bank of England”.

What can you do if you have LUNA cryptocurrency?

First, you should realize that you are not alone in this. Lots of people invested and had savings in LUNA cryptocurrency. You should realize that no matter the amount of money you lost, there are things more important than money and that money comes and goes. No matter the amount of money you lost, there is always the possibility to make them again and to be stronger and wiser.

You should also seek support and try to understand thought what other in your situation is going through.

Should I invest in LUNA right now?

No, this is a no go zone right now. And no matter how much you think it will go back up, you shouldn’t put any more money into LUNA right now.

Useful link:

Luna reddit: luna reddit

Coinmarketcap of LUNA

Luna website

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